On 28 January, the IE Emerging Markets Club hosted a panel discussion on the luxury goods market in the emerging economies known as the “BRICs” (Brazil, Russia, India and China). The event was held in Aula Magna and featured presentations from four esteemed panelists who shared their insights from years of experience developing luxury brands in a BRIC market.
The panel event was the brainchild of board member, Elena Llagostera (PSUL 2012), a graduate of IE’s Executive Masters in Luxury Brands Management. Elena is herself experienced in the luxury sector when she was a Product Manager with Hedonai Beauty Centers. Elena organized the event in response to overwhelming interest from members of the Emerging Markets Club, which boasts a membership of over 1,700 alumni and current students.
“This was a unique opportunity to take advantage of IE’s strong global network and to educate the community about a fast-growing and promising market”, said Elena.
Sara Beneroso (IMBA 2013), a board member in both the Emerging Markets and Luxury & Fashion clubs with experience in Shanghai’s luxury market noted that “with growth opportunities, come challenges.” “For instance, the lack of awareness about luxury brands in the emerging markets makes brand education very important in order to improve customer loyalty”, says Sara.
The first presentation centered on Brazil and was delivered by Livia Fukuda (IMBA 2011), Clienteling Manager at the Louis Vuitton Store in Barcelona. Her presentation highlighted growth opportunities in Brazil, where the luxury market is growing at 12% – triple the rate of the economy. Furthermore, Livia’s presentation mentioned two challenges – labor shortage and high import taxes – as well as the unique local practice of paying in multiple installments.
The Russian luxury market was presented by panelist Antonina Hoppenrath Skorobogatowa (EXMBA 2005), VP of International Sales for the Middle East, Europe, Russia and Central Asia with the Spanish jewelry brand Carrera y Carrera. Antonina described a few particularities of the Russian luxury consumer. For example, while Western taste is skewed towards understatement and individuality, the Russian consumer typically has a preference for opulence, which could be traced to the ornamental aesthetic style of the Orthodox Church. Entry barriers in this market include luxury taxes and complex administrative burden, which encourage brands to enter the market through exclusive distributorships versus retail stores.
The third panelist, Juan Carlos Martin (IMBA 1997) spoke about the Chinese and Asian market, tapping into his 15-year career in the luxury and retail industry, including several years as Retail Outlet manager for Loewe of LVMH Group. Juan explained the different stages of luxury market evolution.
Finally, Pradeep Bhargava, philologist and international trade specialist, spoke about the Indian market. He introduced India’s history with luxury spanning from the royal princes (“maharajas”) of pre-colonial times, to post-independence minimalism (typified by Gandhi) to recent resurgence after market reforms. Pradeep explained that – while Western luxury brands dominate automobiles, watches and yachts in India – local consumers prefer homegrown designers for jewellery, clothing and leather goods given the market’s appreciation for ornate craftwork. However, Pradeep also illustrated some examples of Indian aesthetics being exported and elevated onto the world stage, including Louis Vuitton’s recent ad campaign romanticizing India’s glorious history. Pradeep is currently a Consultant at Pangea 21 Consultora Internacional and founder of Indavant Consulting where he is working to introduce Mediterranean lifestyle products and brands in Asia.
The “Luxury in the BRICs” panel was the third event hosted by the Emerging Markets Club since December 2012. This and past activities – including a panel on “Expat Opportunities in China, Hong Kong and Singapore” and an “Emerging Market Investor Call” presented by HSBC – reinforce the club’s stated goal of enlightening future leaders about the opportunities of emerging economies across various industries, including banking, luxury, energy, tourism, telecoms to entrepreneurship to name a few.
The Emerging Markets Club maintains a Facebook page  as a means for tapping into the IE community’s collective wealth – and diversity – of resources and capabilities in the emerging markets.
The author, Virgil Esguerra (IMBA 2013), is a board member of IE’s Emerging Markets and Finance clubs.